Food costs are also on the increase,
and last week the Office of Fair Trading (OFT) said eight supermarkets
have agreed to a set of principles following concerns over special
offers and promotions for food and drink.

The supermarkets have agreed not to artificially inflate prices to make a later 'discount' look more attractive.

Which? executive director Richard
Lloyd said: 'With 10 million households feeling the squeeze and consumer
confidence remaining low, the Government has a job on its hands to
convince people that everything possible is being done to keep
unavoidable costs like energy and food bills under control.

'We're looking for further progress in
reforming the energy market, an end to misleading food price
promotions, and more competition in banking to take some of the pressure
off hard-pressed consumers.'

Two thirds of people are worried about
interest rates on their savings (68 per cent) and the value of their
pensions (68 per cent), the research found.

Savings rates have plummeted in recent
weeks, following the introduction of a Government scheme at the start
of August to boost lending by giving lenders access to cheap finance.
Analysts have said the scheme has made lenders less reliant on having to
attract savers' deposits.

The research asked 2,100 UK adults in October if they had experienced a range of financial difficulties in the previous month.